Five Myths about the Cloud

Written by Dr. Petra Wanner-Meyer | September 9^th, 2021

The pandemic has turned our working world upside down. Wherever possible, employees revert to working remotely from home. Many businesses use this impulse to switch their business communications to the cloud to re-organize internal work processes and to take pressure off the IT department. But before doing so, you may want to take a closer look at some popular cloud-related myths:

The Costs:

Calculating and comparing the total costs of an on-premises solution with the total costs of a cloud solution can become quite a challenge. After all, how many companies can put an absolutely accurate price tag on overall IT expenditure? Who would be responsible for determining the costs (controlling / IT department / management)? A distinction is necessary to calculate the proportionate costs concerning the infrastructure and the use. In addition to expenditure on hardware and software, labor, energy and facility costs need to be taken into account when calculating general IT expenses. What is often neglected is the fact that businesses do not only have the two options of either buying an on-premises solution or of renting via cloud. Instead, there is also a third option: renting on-premises. This allows for companies to shift costs towards the OPEX model by renting hardware and software from one single supplier - partially even without the commitment of a fixed minimum term.

Flexibility and Scalability:

One major benefit of cloud solutions is the seemingly endless flexibility that comes along with opting for the cloud. Businesses and enterprises with high dynamics and fluctuation can quickly adapt to changing situations. New workplaces can be set up at short notice while workplaces that are no longer required can be removed again in no time. Should additional memory space be required at short notice, it will be made available in a timely manner. It is undisputed that a physical business communications system permanently installed on the premises of the company cannot offer the same degree of scalability and thus flexibility. However, this flexibility is also provided with an on-premises rental model and not exclusive to the cloud. What remains important in both cases is that the respective services are offered with a pricing model that is transparent to the customer.

Greater Performance:

The assumption is that cloud components perform better due to the “best of breed” approach where leading state-of-the art solutions ensure maximum performance. The reality, however, shows that many companies migrate to the cloud via “lift and shift” – existing applications are transferred to the cloud without any changes.  (Source: Studie Cloud Migration 2018, p.35). Merely 35 % of the companies use the migration to the cloud as a starting point to modernize applications and to introduce innovations. The hopes of automatically achieving better performance when migrating to the cloud can only become reality when companies actively grasp the opportunity of modernization. If the existing applications are only shifted to the cloud, no change and no improvement can be assumed.

More Reliability:

Another often stated reason for the switch to the cloud is the demand for “stability and reliability concerning the IT.” (Source: Studie Cloud Migration 2018, p.23). Here, we are confronted with a paradox: one the one hand, moving to the cloud is supposed to guarantee more security, yet on the other hand, security concerns are one of the most common obstacles to switching to the cloud in the first place. Therefore, private cloud solutions are currently rather popular among businesses. Companies that place utmost priority on data security oftentimes reject cloud solutions and either end up renting or buying an on-premises solution.

Passing on IT Responsibilities:

One further argument in favor of outsourcing the services into the cloud is the aim to hand over responsibility of the hardware. Once again, differences between the various cloud models need to be taken into consideration. If the cloud is a private one located on corporate servers and on-premises, the in-house IT department will nonetheless be responsible for the system. The situation is a different one if the applications are outsourced to servers of external service providers or if a full shift to the cloud takes place. Here, businesses generally assume that data security, data backup, regulatory compliance or application availability rest in the hands of the cloud provider. Erroneously – liability issues concerning cloud services are a highly complex matter, and the location of the cloud provider plays a big role.

Conclusion:

Whether businesses opt for a cloud solution, an on-premises solution (either rented or purchased) or a hybrid model thereof, there are always numerous aspects that need to be considered. Calculating the costs, for example, is not as easy as just setting up a cost-benefit calculation. Evaluating flexibility and the scope of services is by far easier: cloud and rental models clearly have a flexibility advantage over the one-off purchased business infrastructure. Yet, it is understandable if companies want to keep the infrastructure and its full control entirely in-house. Additionally, “Security in the Cloud” is a topic often driven by desires, expectations and fears and therefore only offers limited potential and capacity to make a rational decision whether or not to move the own IT infrastructure to the cloud.

So, how do you move from here?

Stay tuned! One of our upcoming blog posts will offer you a checklist with various aspects to consider so you will be able to find the model that best fits your business.